Quantitative analysts constitute a prestigious profession that is without a doubt one of the most widely known in market finance. They are at the base of modern market financing, and the work of a Trader cannot exist without them. In effect, the Quant can be seen as a specialized market finance engineer, who creates product systems to predict risks of portfolios and individual assets.
Market managers rely on these models established with the help of financial mathematics to evaluate the value of financial assets and their derivatives, based on certain indicators. These systems equally allow for the permanent optimization of portfolios managed by Traders, by adjusting the risk/ reward ratio with new models and new derivatives.
The Quant’s goal is therefore principally to establish models allowing a profitability of financial products elevated to the highest level of equal risk.
Quantitative Analysis is therefore the principal source of progress in market finance. This discipline is founded on the study of probability and is used in fields outside of finance, such as sociology, political science, and geosciences; essentially, in all fields where numerical data is widely used.
A Quant’s studies last longer than those of a Trader: they take the same courses in financial knowledge and in trading techniques. Quants, however, follow their initial studies with a Master’s degree (for example, a Masters of Financial Engineering at Columbia) or a PhD (typically in financial mathematics) specialized in probability, algebra, and the computer sciences necessary to build quantitative models.
If the CIT’s diploma doesn’t allow you to become a Quant directly, it will permit you to enter into most Quantitative Analysis programs in prestigious universities. The CIT’s students can easily complete their university career with a PhD or a specialized Master’s degree, and they will have a strong foundation of concrete experience on the CIT’s trading floor—an experience that many Quants never have.
In general, Quants are not in direct contact with financial markets, and they have less pressure than Traders or Sales Traders. Even so, this trade is difficult, preceded by long and costly studies, and Quants hold a heavy responsibility—that of creating financial models used by Traders. If their models are badly developed, the level of risk skyrockets, and heavy losses result. These working conditions justify an elevated pay scale: 60,000€ per year for a junior Quant and 100,000€ as a senior. Bonuses proportional to the performance of the model system are added to this fixed salary